Federal Stimulus Package Update

Greenbush received the following correspondence today from Kansas' Commissioner of Education.

To: Superintendents
From: Alexa Posny, Commissioner of Education
Re: Federal Stimulus Package

As most of you are aware, the federal House and Senate completed negotiations yesterday on a compromise $789 billion economic recovery package that includes approximately $100 billion for education. The House is expected to approve the measure later today, followed by final Senate action today or tomorrow, and present it to the White House by Monday. The legislation provides funding for key state priorities, including Title I ($10 billion) and IDEA ($12.2 billion), the state longitudinal data systems program ($250 million), school improvement programs ($3 billion), and state fiscal stabilization ($53.6 billion which includes $5 billion for state innovation and incentive grants).

On a conference call this noon with other Chief State School Officers, information was shared regarding the stimulus package as well as questions that remain to be answered. The following highlights are areas that I thought might be of interest to you:

· Proposed guidance in terms of the use of these dollars is to be coming out as soon as possible, part of it as soon as next week.
· States and districts must be prepared to spend the money now.
· Discretionary dollars are targeted to keeping teachers employed.
· The greatest concern is under IDEA in terms of the maintenance of effort and supplement vs. supplant; it appears that these dollars are far more restricted than other areas.
· Charter school enhancement grants, teacher quality partnerships, K-12 modernization, renovation and repair grants, and Perkins loan cancellations were removed as separate appropriations.
· The state fiscal stability fund now includes the state innovation and incentive grants and school renovation and rehabilitation grants, however these dollars are not for new construction.

Questions that remain:

• How/what dollars will be allocated to administer these funds/programs/grants at the state level?

• What are the accountability requirements for the use of these dollars? What degree of change/reform is envisioned to be accomplished in this short period of time? What criteria will be used—an increase in the number of teachers employed; student achievement will rise—to determine that the additional dollars had a positive impact on education and the economy?

• What dollars are to be used for stabilization (retaining current staff) vs. reform (innovation)?

• Which dollars are flow-through, which are competitive grants, which come through the SEA, which go through the Governor?

• Under the state stabilization dollars, maintenance of effort can be waived (this has not been determined to be part of IDEA); what criteria will be used to establish economic hardship for individual states?

• What is meant by the primary formula? Does the state need to reapply for the funds or can the current application hold? Must they be used under existing formula grants or is there some flexibility?

• Will all dollars be for 2009 and 2010? (There is some talk that a few of the dollars might be available this fiscal year)

As a final note, Arne and general counsel staff have been working on the regulations that were promulgated in October (e.g., graduation rates). We were informed that the latter part of next week, we can anticipate new guidance.